Inheritance of coreness

A study just published by UK’s Institute for Fiscal Studies states that

Those born in the ’60s and ’70s likely to be no better off in retirement than their predecessors – unless they inherit

Inherited wealth looks like the only major factor that could act to make individuals born in the 1960s and 1970s better off in retirement than their predecessors, on average. When compared with those born a decade earlier at the same age, these cohorts: have no higher take-home income; have saved no more of their previous take-home income; are less likely to own a home; probably have lower private pension wealth; and will tend to find that their state pensions replace a smaller proportion of previous earnings.

Central and Northern European citizens are looking at peripheral Europe and thinking austerity was long due, and that the “internal devaluation”, i.e. impoverishment of the population, is well deserved.

Impoverishment, however, is a general consequence of the Empire without Emperor systemic cycle of accumulation that started a few decades ago and is now in full swing. Many German citizens, particularly the young, have relatively low paid jobs – much worse paid than their parents did, and these jobs are temporary or uncertain – contrarily to the permanent positions, effectively for life, that their parents enjoyed. The non geographic periphery is permeating the old core, and we are only seeing the beginning of this process. Nations retain a central role, and stronger nations will afford their citizens a higher degree of protection. But decline is always relative, and the process is generalised.

I dare say that those who will be better off than their predecessors through inherited wealth are also in two categories: the ones that, through their own resources will remain part of the non-geographic core, and the ones who will not have the skills or connections in the network to allow them a core position. The second group will possibly be better off than their predecessors, but the inherited wealth will be spent, and their own children will be worse off than they will. The internalisation of the core-periphery structure is a very fast process for some (for instance the recently unemployed who will never again have a similar job), but it can last more than one generation in some cases.

 

Glossary

Geographic core-periphery structure: in short, developed vs. under-developed world.

Non-geographic core-periphery structure: in short, activities and people in the developed world that do not enjoy, or enjoy in a very limited way, the benefits of coreness.

Empire without Emperor: the new form of organisation of the capitalistic world system.